Today, the Fair Work Commission handed down the Annual Wage Review 2018-2019 decision.
That is to increase the national minimum wage and award wages by 3% effective from 1 July 2019.
The new National Minimum Wage will be $740.80 per week, or $19.49 per hour.
The increase is fully absorbable against overaward payments ie if you are paying employees base rates of more than 3% above award and you are also paying other entitlements under the relevant award and National Employment Standards, you can fully absorb the increase.
If you have an enterprise agreement or contract of employment that stipulates that wages will be adjusted in line with annual wage review or variations in award rates, you will need to pass these increases on.
If you are paying award-covered employees on an annualised salary basis or on an overaward payment that is intended to set off any monetary award provisions, you should review the arrangement to ensure that it remains above award once the new rates take effect.
Anyone requiring assistance in dealing with the issue is welcome to contact us for support.
The changes keep coming in the field of workplace relations:
Annual Wage Review
There are a number of changes taking effect from 1 July 2018 as a result of the decision in the 2017-2018 Annual Wage Review as follows:
- The national minimum wage and award rates have been increased by 3.5%.
- The filing fee for dismissals, general protections and anti-bullying applications made to the Fair Work Commission increased to $71.90.
- The high income threshold in unfair dismissal cases increased to $145,400 and the compensation cap to $72,700.
The next wave of Sunday penalty rate reductions flowing from last year’s penalty rates decision also take effect from 1 July 2018 as follows:
Fast Food Industry Award 2010
- Level 1, full-time and part-time employees: 145% > 135%
- Level 1, casual employees (including casual loading): 170% > 160%
- Other levels: no change
Hospitality Industry (General) Award 2010
- Full-time and part-time employees: 170% > 160%
- Casual employees stay at 175% including casual loading
General Retail Industry Award 2010
- Full-time and part-time employees: 195% > 180%
- Casual employees (inclusive of casual loading): 195% > 185%
Pharmacy Industry Award 2010
- Full-time and part-time employees: 195% > 180%
- Casual employees (inclusive of casual loading): 220% > 205%
Extension of ATO’s contractor reportable payments scheme
On 9 May 2017 the Government announced that from 1 July 2018 businesses that supply courier or cleaning services will need to report payments made to contractors if the payments are for courier or cleaning services.
These payments must be reported to the ATO each year using the Taxable payments annual report.
Businesses in the building and construction industry have been subject to this requirement for a number of years.
Labour hire licensing
The Victorian Labour Hire Licensing Act has been passed by Parliament and is expected to come into effect by no later than 1 November 2018.
This means that labour hire firms will not be able to legally operate in Victoria unless they have a licence having passed a fit and proper person test and satisfied a number of other requirements.
Similar legislation is already operating in Queensland and in the process of implementation in South Australia.
Long service leave
The Long Service Leave Act 2018 makes a number of changes to long service leave entitlements in Victoria. These include:
- Employee access to long service leave after 7 years of eligible service (down from 10 years).
- The existing entitlement to payment in lieu on termination of employment after 7 years’ eligible service remains.
- Unpaid parental leave will count as service (whereas currently it does not count but doesn’t break service).
- If an employee resigns and is reemployed within 12 weeks, service will be deemed to be continuous (currently that only happens if the employee is dismissed and reengaged within 12 weeks).
- Long service leave service will transfer from one employer to another where there is a transfer of tangible and/or intangible assets and the employee performs duties in connection with those assets (currently only tangible assets matter).
- The method of calculating entitlements where there have been changes in an employee’s working hours is changing.
- The ability of an employer to apply for an exemption will be abolished.
- Penalties for non-compliance will go from being civil penalties to being criminal penalties.
This legislation is expected to come into operation on or about 1 November 2018.
Portable long service leave in some industries
There is already a statutory portable long service leave scheme in the construction industry – see Coinvest.
The Victorian Long Service Benefits Portability Bill 2018 (Bill) will, if passed, extend portable long service leave benefits to employees in the the community services, contract cleaning and security industries.
In essence, this means that a worker in those industries will be eligible for long service leave once they have 7 years’ industry service regardless of how many employers that might be with.
Employers will have to contribute to a fund run by a statutory authority which will manage workers’ entitlements.
Domestic Violence Leave
The Fair Work Commission has approved an award entitlement to unpaid domestic violence leave of up to 5 days per annum as part of the 4 year review of modern awards. More to come on this regarding when it will take effect but it should be some time soon.
The Fair Work Commission also made a decision on a model clause for conversion of casuals to full-time or part-time employees in 2017 but it is yet to be flowed on to awards. Again that is something that should happen soon.
There is a lot that has changed and a lot more coming employers’ way. We will be issuing regular updates on new developments so please subscribe if you want to be kept informed. Scroll down to the right bottom of the page to do that.